The patent term compensation mechanism has been newly introduced into the fourth revision of the Patent Law of China and attracted much attention. For the first time, it is possible for the patent term of an invention patent in China to be extended, such as in cases where patents are experiencing an unreasonable examination delay and also in cases where the patents are related to new drugs obtaining marketing approval in China.

    However, while the new patent law will come into force on June 1, 2021, the final version of the Implementing Regulations of the Patent Law is not ready yet, and it appears that the Regulations will not be issued on or before June 1.

    In order to make a smooth transition, the CNIPA recently issued the “Interim Measures for Related Examination Procedure with regard to the Implementation of the Revised Patent Law”, so as to regulate the related procedures.

    With regard to the patent term compensation for an unreasonable examination delay, Rule 5 of the measures provides that for invention patents granted on or after June 1, 2021, the patentee may submit a request for compensation for the term of patent right in paper form within three months from the grant date, in accordance with Article 42.2 of the revised Patent Law. Subsequently, the patentee shall pay the relevant fees according to the payment notification issued by the CNIPA, and the CNIPA will examine the above request after the issuance of the newly revised Implementing Regulations of the Patent Law.

    Article 42.2 of the revised Patent Law stipulates that if the invention patent is granted after four years from the filing date of the application and three years from the date of requesting for substantive examination, the patent administration department under the State Council shall, at the request of the patentee, compensate the patent term for the unreasonable delay in the process of examination of the application, except for an unreasonable delay caused by the applicant.

    Therefore, for patentees, once the announcement of the grant of the patent right is received, the period A between the announcement date and the filing date, and the period B between the announcement date and the date of requesting for substantive examination need to be calculated. If the conditions that the period A > 4 years and the period B > 3 years are met, the patent may be initially qualified for the patent term compensation for examination delay.

    The reason for the wording “be initially qualified” is because both the period A and the period B shall also deduct[z1]  “the unreasonable delay caused by the applicant”, which we believe may comprise, for example, the requested extension for responding to office actions, deferred period for substantive examination, the period for being deemed as withdrawn and restoring the right, etc. The definition of “the unreasonable delay caused by the applicant” and the explicit calculation method have not been issued by the Implementing Regulations and the Guidelines for Patent Examination, so we shall wait and see.

    With regard to the patent term compensation for patents related to new drugs obtaining marketing approval in China, Rule 6 of the measures provides that from June 1, 2021, the patentee may submit a request for compensation for the term of patent right in paper form within three months from the date of the marketing approval of a new drug, in accordance with Article 42.3 of the revised Patent Law. Subsequently, the patentee shall pay the relevant fees according to the payment notification issued by the CNIPA; and the CNIPA will examine the above request after the implementation of the newly revised Implementing Regulations of the Patent Law.

    Article 42.3 of the revised Patent Law provides that in order to compensate for the time spent in the marketing approval of a new drug, the patent administration department under the State Council shall, at the request of the patentee, compensate the patent term for invention patents related to new drugs that have obtained marketing approval in China; the compensation period shall not exceed 5 years, and the total effective patent term from the marketing approval date of the new drug shall not exceed 14 years.

    Therefore, patentees shall, when trying to get marketing approval for a new drug in China, bear in mind whether the new drug involves any granted patent. If yes, and the granted patent is qualified for the patent term compensation in term of requirements, such as the type of the drug, the form (claim type) of the patent, and the remaining patent term, the patentee shall make an inquiry with the agent representing the patent about the possibility of compensation.

    As the determination of patent term compensation eligibility for patents related to new drugs is quite complicated, it is strongly suggested that the patentee shall contact the agent as soon as possible, so as to ensure sufficient time to work together with the agent for a proper assessment.  Also, the details of the requirements, that is, the criterion for the assessment, have not been issued yet, so we will also wait and see for further issuance by the CNIPA.

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